Saturday, June 15, 2024

Fortune asked Alexis Ohanian about being cut out of Reddit’s IPO filing by his onetime best friend. His response: ¯_(ツ)_/¯

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Nineteen years after its founding, online forum Reddit is going public. But what should have been a joyous (and likely remunerative) affair for its two cofounders, Alexis Ohanian and current CEO Steve Huffman, has instead dredged up much of the disappointing fallout that led to the end of their relationship. 

The two cofounders started Reddit in 2005 when they were still in college. For a while they were both business partners and fast friends, living together and, when not working on their startup, socializing and playing video games. Huffman was a groomsman at Ohanian’s wedding to legendary tennis player Serena Williams in 2017. But the relationship between the two cofounders soured over differences about how to handle offensive comments on Reddit. 

When Reddit publicly filed for its IPO on Thursday it omitted any mention of Ohanian. The filing, called an S-1, usually serves to paint a picture of a company’s finances but it can also include an overview of its history and key figures. In a letter included as part of the filing, Huffman, the now CEO, referred to the founding of the company using plural pronouns but never mentioned Ohanian by name. Many observers and analysts found that noteworthy, given that Ohanian is still a rather public figure. Huffman also mentions his own return to the company in 2015. Even Huffman’s return is now a source of tension. At the time Ohanian said he’d pushed for his cofounder to be named CEO again, while Huffman credits Sam Altman, then a Reddit board member, with bringing him back.

When reached for comment by Fortune about his exclusion from Reddit’s S-1 filing, Ohanian replied with a shrug emoticon: ¯_(ツ)_/¯. 

Reddit declined to comment. 

On X, Ohanian made mention of the upcoming IPO. “Pretty wild seeing $RDDT going public after all these years,” Ohanian wrote. “Founders, keep going.” 

Pretty wild seeing $RDDT going public after all these years. Founders, keep going.

— Alexis Ohanian 🇦🇲 (@alexisohanian) February 22, 2024

Reddit is known for its online communities, called subreddits, on all manner of topics. The wide variety of discussions, ranging from investment advice (the subreddit R/wallstreet bets was instrumental in the Gamestock meme stock hubbub) to debates about art, made the platform a hub of lively online debate. However, some of its more unsavory communities became breeding grounds for toxic online speech, including racism, misogyny, and religious discrimination. Ultimately disagreements over how to moderate such content led to a butting of heads between Huffman and Ohanian. 

At the time, Ohanian wanted to ban Reddit groups that actively supported discrimination, while others at the company, including Huffman, were reluctant to do so, citing concerns over free speech. By summer of 2020, when national Black Lives Matter protests had spread across the country in response to the killing of George Floyd, the question of hate speech and racism on the platform became unavoidable. Eventually Huffman acquiesced and announced that he would implement a user policy that explicitly banned hate speech. Ohanian resigned his board seat in protest of Reddit’s lax guidelines about hate speech, asking the board’s remaining members to fill it with a Black person. (Reddit picked Y Combinator CEO Michael Seibel to replace Ohanian). By this time, the relationship between the two was already strained, and Ohanian reportedly did not tell Huffman he was planning to resign before doing so publicly. 

The two have barely spoken since then. Ohanian told Wired he hadn’t thought of Huffman much since he departed the board in 2020. 

Still, even though Ohanian wasn’t mentioned in the filing, he stands to make some money from the IPO. In a post on X, Ohanian said he does still own some shares from when he served as executive chairman in 2014, but since he wasn’t named in the filing, his stake must be small enough that Reddit wasn’t legally required to disclose it. 

The company is aiming for a $5 billion valuation, according to the New York Times. That would mean Huffman’s 3.3% stake in the company is worth about $165 million. 

The filings paint Reddit as a company that is growing but still unprofitable, not uncommon for tech IPOs. Revenue grew 21% in 2023 to $804 million, while losses were $90.8 million—an improvement from the $158 million it lost in 2022.

Editor’s note: The father of this reporter was a thesis advisor for Ohanian when he attended the University of Virginia as an undergraduate.

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